SAA appoints Zuks Ramasia as interim CEO

The outgoing CEO, Vuyani Jarana, was meant to vacate office at the end of August, after serving his notice period, but he will now be out by the end of the weekend, with the board saying he will briefly hand over by Monday.

They expressed sadness at his departure.

Jarana said in his resignation letter that the company’s strategy was being “systemically undermined”. He also recently complained about legislation holding back the company’s competitiveness.

SAA board member Thandeka Mgoduso addressed the media briefing at the airline’s headquarters. Mgoduso confirmed that Jarana, who did not attend the briefing, would not be serving a notice period into the end August after the board acceded to his request to be let go early following his resignation last weekend.

“The board of South African Airways is pleased to announce the appointment of Miss Zuks Ramasia as the acting chief executive officer of SAA as of Monday because the outgoing CEO’s last day in office is Monday the 10th of June as per agreement with the board,” Mgoduso said.

“The board has commenced a search, domestically and globally, for a permanent CEO with appropriate experience and expertise to stabilize the company and to oversee the implementation of the long-term turnaround strategy.

“As a consequence of the change in leadership, Mr Vuyani Jarana will no longer serve as the CEO of SAA as from end of day on Monday, but will avail himself to provide transitional support and handover processes to the board, and management when so required for the duration of his notice period which goes on until the end of August.”

Ramasia was previously general manager for operations at SAA.

Jarana tendered his resignation last week as group chief executive, citing the airline’s mounting debt due to uncertainty about funding and lack of support from government as a shareholder in implementing the airline’s long-term turnaround strategy.

In his leaked resignation letter, Jarana said that a big chunk of the R5 billion bailout SAA received from government for the 2018/19 financial year had been used to pay creditors up to the end of March 2018, to the point that the airline was on the brink of failing to pay salaries on three occasions.

Mgoduso said that Ramasia was an experienced executive with an extensive aviation background.

Quoting board chairperson JB Magwaza, Mgoduso said at Ramasia would be supported by an experienced executive committee, including chief restructuring officer Peter Davies and interim chief financial officer Deon Fredericks.

“With the support of the shareholder, the board and executive management of SAA are fully committed to the turnaround strategy. In that regard, we are working closely with the shareholder to optimize the aviation assets of the State,” Mgoduso said.

“The board is also taking steps to strengthen the executive capacity in the group. We have appointed Adam Vos as the new CEO of South African Airways Technical, and we are finalising the appointment of a permanent CEO for Mango. We are close to concluding other senior appointments and will make further announcements in due course.”

Fielding questions, Magwaza said that the board was not happy with Jarana’s resignation, and had asked him to stay “but he said no”.

Mgoduso said that the board acknowledged the critical financial circumstances confronting the airline, and was thus in ongoing discussions with the department of public enterprises, National Treasury, and financial institutions with respect to putting in place a financial structure appropriate to support the long-term sustainability of the company.

In April, Jarana had announced his turnaround strategy for the airline, which was bailed out by the government last year, with R5 billion allocated in the medium-term budget policy statement to help it face a looming debt crisis.

The airline had R19.1 billion worth of government guarantees, of which R14.5 billion were already used and, in March next year, one billion of this will be maturing.

The government said the allocation was to help SAA repay this debt.

(Additional reporting, ANA)

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